B.P. Greer Recycling Inc files for Chapter 11

B.P. Greer Recycling Inc files Chapter 11

B.P. Greer Recycling Inc., which once hailed itself as the best commercial scrap metal recycling service, recently announced that it had filed for Chapter 11 bankruptcy protection. According to the Triad Business Journal, the company now intends to sell the majority of its remaining assets in an auction sale.

B.P. Greer Recycling Inc’s fall into debt

In court documents, B.P. Greer cited a global collapse in demand for scrap metals as its primary reason it sought Chapter 11 bankruptcy protection. Shanghai Metal Market Magazine reported that as scrap metals prices fell and the value of the U.S. dollar strengthened, the company’s revenues had dropped significantly from $36.2 million in 2013 to under $20 million in 2015. This has become a trend in the scrap metals recycling market, as many companies have fallen into insolvency this year.

According to bankruptcy filings, B.P. Greer listed assets between $1 million and $10 million and debts ranging from $10 million to $50 million for more than 125 creditors, which include scrap recyclers, brokers and equipment manufacturers. Recycling Today magazine reported that chief among these creditors is Carolina Bank, which is owed approximately $9.3 million on three different loans. After B.P. Greer failed to make payments on its debt obligations on the most recent $1 million loan with a commercial security agreement, Carolina Bank brought a lawsuit against the company. According to the Triad Business Journal, further complicating B.P. Greer’s financial outlook was the fact that it owed more than $43,000 to the Rockingham County Tax Department, over $23,000 to Sparks and Sons Service Stations and $9,300 to Warren Buffett’s Berkshire Hathaway Homestate Cos.

The company’s reorganization plan

According to bankruptcy documents, the court approved the sale of most of B.P. Greer’s remaining assets for auction. These assets will include its main manufacturing facility, most of its equipment and land. The plan is for the assets to be sold in a stalking horse bidding process to Foss Industrial Recycling. If there are no bidders, Foss Recycling will be the buyer. This stalking horse auction will include potential bidders that must be approved by the court prior to the Dec. 4 deadline. The opening bid for B.P. Greer is $2.4 million, but if bidders only want to purchase individual aspects of the company’s remaining assets, the bids will start at $125,000 over the sale price.

Are you a creditor in a bankruptcy?  Have you been sued by a bankrupt?  If you have any questions about your rights, please contact me, Joel Glucksman, at 201-806-3364.